How to Use AI in Accounting: Transforming Financial Workflows in 2025

In an industry often stereotyped as resistant to change, accounting is undergoing a remarkable technological revolution. The integration of artificial intelligence into financial processes isn’t just a futuristic concept—it’s happening right now, and it’s reshaping how accountants work. But beyond the buzzwords and hype, what does AI in accounting actually look like in practice?

At Subledger, we’ve seen firsthand how intelligent automation transforms financial workflows. In fact we are building this change. While many accounting platforms claim to use AI, the real value comes from specific, targeted applications that solve genuine pain points for finance professionals.

Watch these AI accounting features in action:

The Current State of AI in the Accounting Industry

The accounting industry has evolved far beyond spreadsheets and manual data entry. Today’s financial professionals are leveraging sophisticated AI tools to:

• Eliminate repetitive tasks that once consumed hours of billable time
• Identify patterns and anomalies in financial data that humans might miss
• Generate insights from vast amounts of transactional information
• Enhance accuracy while reducing the risk of human error

According to recent industry surveys, firms implementing AI solutions report time savings of 30-50% on routine accounting tasks. This efficiency isn’t just about cost reduction—it’s about freeing accounting professionals to focus on higher-value strategic work. Even in non-accounting industries AI saves significant amounts of time with 91 % of leaders and 67% of employees reporting more than 30 minutes time savings per day in this Zoom study.

How Accounting Firms Are Leveraging AI Technologies

The adoption of AI in accounting firms has accelerated dramatically, with implementation varying by firm size and specialization. While the Big Four accounting firms have invested millions in proprietary AI solutions, mid-tier and boutique firms are increasingly incorporating third-party AI tools into their service offerings.

According to a 2024 survey by the American Institute of Certified Public Accountants (AICPA), 73% of accounting firms have implemented at least one AI application in their practice, with adoption rates highest in:

• Client financial statement preparation - Using AI to draft notes to financial statements and identify potential disclosure requirements
• Risk assessment - Applying machine learning to identify unusual transactions or high-risk audit areas
• Tax planning - Analyzing client data against tax code changes to identify planning opportunities
• Client advisory services - Providing AI-enhanced forecasting and scenario analysis

For smaller firms, platforms like Subledger offer a competitive advantage previously available only to larger organizations with significant technology budgets. As one partner at a regional firm noted, “AI has become the great equalizer. We can now provide the same sophisticated financial insights as the Big Four, but with the personalized service of a boutique firm.”

Many accounting firms report that AI implementation has transformed their business models, shifting revenue from compliance-focused services to higher-value advisory work. This transition aligns with client expectations for accountants to serve as strategic business partners rather than just financial record-keepers.

How AI Is Actually Used in Accounting: Real-World Applications

Automated Reconciliations: Beyond Basic Matching

Reconciliation has traditionally been one of accounting’s most tedious processes. Without AI, accountants must manually match transactions across different systems, investigate discrepancies, and adjust entries accordingly—a process prone to human error and consuming valuable time.

Subledger’s AI-powered reconciliation system goes beyond simple pattern matching. Our technology:

• Intelligently maps data from bank and credit card statements without manual configuration
• Learns from previous reconciliations to improve accuracy over time
• Identifies matching transactions even when amounts or dates have slight variations
• Flags potential issues that require human oversight

Our users report: “What used to take our team two full days at month-end now happens continuously in the background. We only need to review the exceptions, which is about 5% of what we used to handle manually.”

AI Copilots: Your Financial Thinking Partner

The most exciting development in accounting AI isn’t just automation—it’s augmentation. AI copilots serve as collaborative partners, enhancing human capabilities rather than replacing them.

Subledger’s AI copilot can:

• Help review your accounts before an audit or on an ongoing basis
• Draft explanatory notes for unusual transactions
• Suggest appropriate account coding based on transaction patterns
• Answer questions about accounting standards in the context of your specific situation
• Implement the proposals directly always safely and with your approval
• Help prepare financial statements with appropriate disclosures

The copilot demonstrates particular strength when dealing with complex accounting standards like ASC 842 (Leases), ASC 606 (Revenue), and IAS 36 (Asset Impairment), where it can suggest appropriate journal entries and disclosures based on transaction specifics.

This isn’t about removing the accountant from the equation—it’s about making them more effective. The copilot handles the routine aspects while allowing the human to apply professional judgment where it matters most.

Generative AI in Financial Reporting

Generative AI is revolutionizing how financial reports are created and presented. Unlike templated reports of the past, AI can:

• Generate narrative explanations of financial performance
• Create customized reports for different stakeholders
• Highlight key variances and explain potential causes
• Suggest visualizations that best communicate complex financial data

These capabilities are particularly valuable for management discussion and analysis (MD&A) sections of financial reports, helping to explain material changes in financial position and results of operations as required by SEC Regulation S-K.

Subledger’s integration capabilities allow these reports to draw from all connected systems, creating a single source of truth without data duplication or manual transfers.

Examples of AI in Accounting That Drive Business Results

Example 1: AI in Accounting and Auditing Processes

The integration of AI into audit workflows represents one of the most significant transformations in the accounting profession. Traditional sampling-based audits are giving way to comprehensive data analysis, with AI examining 100% of transactions rather than just a representative sample.

Subledger’s AI audit capabilities support compliance with auditing standards like PCAOB AS 2401 (Consideration of Fraud) and ISA 240 by:

• Analyzing journal entry patterns to identify potentially unusual transactions that warrant further investigation
• Automating three-way matching of purchase orders, receiving reports, and vendor invoices
• Evaluating revenue recognition against ASC 606/IFRS 15 criteria for proper timing and measurement
• Maintaining audit trails that document the basis for accounting treatments and key judgments
• Performing continuous monitoring of internal controls as required by Sarbanes-Oxley Section 404

A regional CPA firm implementing Subledger’s AI audit tools reported completing audits 40% faster while simultaneously increasing the scope of their testing procedures. Their managing partner explained: “We’re now spending our time evaluating the exceptions flagged by the AI rather than hunting for them manually. This has improved both audit quality and efficiency.”

For companies preparing for an audit, Subledger’s AI continuously evaluates financial data against relevant auditing standards, flagging potential issues for correction before external auditors begin their work. This proactive approach has reduced audit adjustments by up to 60% for many organizations, resulting in smoother audit cycles and reduced professional fees.

Example 2: Tax Planning and Compliance

Managing complicated and regionally different tax regimes can be a real headache. Subledger’s AI can give a first indication where the biggest opportunities for tax savings lie or where there are potential compliance problems.

Example 3: Cash Flow Forecasting

It’s easy to generate quick cash flow forecasts for specific scenarios based on the current financials. This saves time in FP&A work and allows for quick what-if decisions. Subledger supports sophisticated FP&A work with some of it’s other features like e.g. the real-time spreadsheet sync.

How to Start Using AI in Accounting

Implementing AI in accounting doesn’t require a complete system overhaul. Instead, follow these practical steps:

1. Identify your biggest pain points: Where do your team members spend the most time on repetitive tasks? For many businesses, these include financial statement preparation and reconciliation processes.
2. Start with targeted solutions: Begin with specific AI applications like automated reconciliations rather than attempting to transform everything at once.
3. Choose software with native integrations: Subledger’s ability to connect directly with other financial systems eliminates data silos and manual transfers.
4. Measure concrete results: Track time savings, error reduction, and other quantifiable benefits.
5. Be realistic about the application of AI: Everyone is talking about how AI will replace human accountants but the more realistic outcome is that it will improve and uplevel their work.
6. Align with accounting frameworks: Ensure your AI implementation supports your specific accounting framework requirements, whether that’s US GAAP, IFRS, or industry-specific standards like FERC for utilities or NAIC for insurance companies.

The Efficiency Advantage of AI-Powered Accounting

The true value of AI in accounting isn’t just about doing the same work faster—it’s about transforming what’s possible for financial professionals.

With Subledger’s efficient interface and AI capabilities, accounting teams can:

• Provide real-time financial insights instead of backward-looking reports
• Shift from data processors to strategic advisors
• Identify financial optimization opportunities proactively
• Scale financial operations without proportional headcount increases
• Enhance compliance while reducing manual oversight

The Future of AI in Accounting: What’s Next?

As we look ahead, several emerging trends will shape how AI continues to transform accounting:

• Predictive analytics will move from forecasting to prescriptive recommendations
• Natural language processing will make financial data accessible to non-financial stakeholders
• Continuous auditing will replace periodic reviews
• AI ethics frameworks will govern how financial AI makes decisions

Frequently Asked Questions About AI in Accounting

What is AI in accounting?

AI in accounting refers to the application of artificial intelligence technologies—including machine learning, natural language processing, and computer vision—to automate, enhance, or transform traditional accounting processes. Unlike basic automation that follows pre-defined rules, accounting AI can learn from data patterns, adapt to new situations, and make recommendations based on complex financial information. Modern accounting AI encompasses everything from transaction categorization to advanced forecasting models and natural language generation for financial reporting.

How is AI changing the role of accountants?

Rather than replacing accountants, AI is elevating their role from data processors to strategic advisors. By automating routine tasks like data entry, reconciliation, and basic report generation, AI enables accounting professionals to focus on financial analysis, strategic planning, and business advisory services. The most successful accounting professionals are those who combine their financial expertise with an understanding of how to leverage AI capabilities.

What accounting processes benefit most from AI implementation?

The accounting processes that benefit most from AI implementation include:

• Accounts payable and receivable management
• Bank and credit card reconciliations
• Revenue recognition under complex standards like ASC 606/IFRS 15
• Financial close processes
• Variance analysis and financial reporting
• Lease accounting under ASC 842/IFRS 16
• Tax provision calculations

How does AI improve accounting accuracy?

AI enhances accounting accuracy through several mechanisms:

• Eliminating manual data entry errors through automated extraction and processing
• Applying consistent accounting treatments across similar transactions
• Identifying anomalies that might indicate errors or fraud
• Ensuring compliance with complex accounting standards
• Maintaining comprehensive audit trails of all system decisions

Conclusion: Embracing AI as a Competitive Advantage

The question is no longer whether AI has a place in accounting—it’s how quickly firms can adapt to this new reality. Those who embrace these tools thoughtfully will gain significant advantages in efficiency, accuracy, and strategic capability.

Subledger’s approach combines powerful AI with an intuitive interface and seamless integrations, creating a platform that enhances what accounting professionals do best—providing financial insight and guidance that drives business success.

Ready to see how AI can transform your accounting workflow? Explore Subledger’s AI-powered accounting platform and discover a more efficient way to manage your finances.

Choosing the Right AI Accounting Solution

With so many options available, selecting the right AI accounting solution can be challenging. For a comprehensive comparison of leading solutions, check out our AI Accounting Tools Comparison to find the best fit for your business needs.

Preparing Your Team for AI Adoption

The transition to AI-powered accounting isn’t just about technology—it’s also about people. Learn how accountants can upskill for the AI era to maximize the benefits of these new tools while developing valuable strategic skills.